Read Drug & Chemical Co. v. Claypoole

Digges, J., delivered the opinion of the Court. This appeal involves the construction of chapter 542 of the Acts of the General Assembly of Maryland of 1933, approved by the Governor on April 21st, 1933, which provides : “Aw Act to add a new section to Article 56 of the Annotated Code of Maryland (1924 Edition), title ‘Licenses,’ sub-title ‘Traders,’ said new section to be known as Section 65A and to follow immediately after Section 65 of said Article, imposing additional annual license fees on every person, firm, corporation, association or co-partnership opening, establishing, operating or maintaining two or more mercantile establishments. “Sectiow 1. Be it enacted by the General Assembly of Maryland, That a new section be and it is hereby added to Article 56 of the Annotated Code of Maryland (1924 Edition), title ‘Licenses,’ sub-title ‘Traders,’ said new section to be known as Section 65A, to follow immediately after Section 65 of said Article, and to read as follows: “65A. Every person, firm, corporation, association or co-partnership opening, establishing, operating or ²⁵² maintaining two or more stores or mercantile establishments where goods, wares and/or merchandise are offered for sale at retail within this State, under the same general management, supervision, or ownership, shall pay the license fees hereinafter prescribed for the privilege of opening, establishing, operating or maintaining such stores or mercantile establishments.

The license fee herein prescribed shall be paid annually, and shall be in addition to the license fee prescribed in Sections 45 to 65, both inclusive of this Article. “The license fees herein prescribed shall be as follows : “(1) Upon two stores or more, but not to exceed five stores, the annual license fee shall be five dollars for each such store; “(2) Upon each store in excess of five, but not to exceed ten, the annual license fee shall be twenty dollars for each such additional store; “(3) Upon each store in excess of ten, but not to exceed twenty, the annual license fee shall be one hundred dollars for each such additional store; “(4) Upon each store in excess of twenty, the annual license fee shall be one hundred and fifty dollars for each such additional store. “The term 'store’ or mercantile establishments as used herein shall not be construed to include automobile service stations at which the principal business is the sale or distribution of gasoline and motor fuel. . “Seo. 2. And be it further enacted, That this Act shall take effect June 1, 1933.” There are two questions upon which this court is asked to pass: Eirst: Is the license fee or occupational tax provided for in the act required to be paid on the 1st day of June, 1933, for eleven-twelfths of a year, said term being from June 1st, 1933, to May 1st, 1934; or, to be more exact, does the act require holders of trader’s licenses which have been issued ²⁵³ as of May 1st, 1933, and paid for, and which do not expire until May 1st, 1934, to obtain additional licenses and pay additional fees for the same privilege already licensed and paid for % Second: Does the act require that in Baltimore City and each of the counties the additional license fees imposed, whenever payable, upon the stores within the limits of the city or county for which licenses are there issued, be computed on the basis of all the stores in the state for which licenses may be issued in every county and Baltimore City; or, expressing this question in another way, is the additional license fee based upon the number of stores operated under one ownership, management, and control in the whole state, or is it to be computed upon the construction that each county of the state and Baltimore City constitutes a separate and distinct entity for the purpose of computing the fee ? These questions are raised on this appeal by a class bill filed by the appellant, in its own behalf as well as on behalf of all others similarly situated who shall come in and become parties to the suit, against the clerk of the Court of Common Pleas of Baltimore City, the comptroller of the state treasury, and the various inspectors and assistant inspectors of state licenses whose authority and duty it is to compel observance of the license laws of the state. The defendants filed an answer which admits the facts but denies the conclusions of law contended for by the complainant, and which, in practical effect, amounts to a demurrer to the bill.

The bill prayed a permanent injunction against the state officials and the clerk of the court, enforcing the act according to the construction placed upon it by the Attorney General of the State, which construction is that the additional fee is collectible for a proportionate part of the year, beginning June 1st, 1933, and ending May 1st, 1934, and that, in computing the fee, the number of stores owned, controlled, managed, and operated by one individual, corporation, or copartnership in the state as a whole shall be used as a basis for the calculation. The case was heard on bill and answer; and the chan ²⁵⁴ cellor by decree dismissed the bill, thereby -upholding the contention of the State. The appeal is from that decree. We are not called upon to consider the validity of this legislation from a constitutional standpoint, as objection on that ground to similar legislation has been overruled by the Supreme Court of the United States in the case of State Board of Tax Commrs. of Indiana v. Jackson, 283 U. S. 527 , 51 S. Ct. 540 , 75 L. Ed. 1248 .

We are not-asked to determine the question of whether or not the Legislature had the constitutional power to pass the act, but to decide what the act, as passed, means. In approaching this question, its proper solution is largely controlled by determining whether the act is isolated and independent legislation, or is a component part of the body of legislation now in force, as codified in article 56 of the Code-. The title and the enacting clause make it apparent that it was enacted as an addition to the provisions of article 56, and to become an integral part of its provisions as a whole; the language being “that a new section be and it is hereby added to article 56 of the Annotated Code of Maryland (1924 Edition), title ‘Licenses,’ sub-title ‘Traders,’ said new section to be known as section 6 5A, to follow immediately after section 65 of said article, and to read as follows,” section 65A then providing that all persons, firms, corporations, associations or copartnerships which come within the description therein contained “shall pay the license fees hereinafter prescribed for the privilege of opening, establishing, operating or maintaining such stores or mercantile establishments. The license fee herein prescribed shall -be paid annually, and shall be in addition to the license fee prescribed in sections 45 to 65, both inclusive of this article.” There is nothing contained in section 6 5A, or in any other part of chapter 542 of the Acts of 1933, providing for the obtention of a trader’s license.

Neither does it independently make provision by whom and in what manner the collection is to be made, or for the enforcement of the penalties for failure to obtain said license or pay the fees prescribed. It simply provides that, if there are two or more stores or mer ²⁵⁵ cantil© establishments where goods, wares and merchandise are offered for sale at retail within this state, under the same general management, supervision or ownership, they shall pay additional fees to those prescribed by sections 45 to 65 of article 56, which additional fees are exacted because of the nature and method of ownership and operation. The time of the act taking effect, according to its terms, is June 1st, 1933. The appellant, in order to conduct a retail trader’s business, was and still is required to obtain a license and pay certain fees, as prescribed by said sections of article 56, such license to be an annual license and dated May 1st of each year, which entitled the holder thereof to conduct business for the period of one year from the date of license; all such licenses being null and void on the 1st of May next succeeding the date of their issue.

All licenses shall be granted by the clerks of the circuit courts for the counties and-the clerk of the Court of Common Pleas in the City of Baltimore, except where a different mode is especially provided, but they are expressly forbidden to date any such license other than the 1st of May in each and every year, except when the trader engages in business in any other month subsequent to May 1st, when such license shall be issued from such month and a ratable sum shall be charged therefor. Article 56, sec. 1. It is therefore clear that section 65A forms a part of article 56, comprising one entire system, and must be construed together-. Spielman v. State, 27 Md. 525 .

The appellant here applied for and received a license to conduct a retail trader’s business on May 17th, 1933, prior to the date upon which the act of 1933 went into effect. Under such license, having paid the fee then required, it was entitled to operate by virtue of such license until May 1st, 1931. The fees provided for by the act of 1933, effective June 1st, 1933, are declared to be in addition to the fees required by the other sections of article 56. Upon the payment of these additional fees, the applicant is given no additional license; that is to say, he can do nothing which he might not have done under the license previously secured. ²⁵⁶ It seems clear, reading together and construing as a whole article 56, that trader’s license fees are collected annually, and that the year is from May 1st to May 1st; that is, that the taxing year for such an occupational tax begins on May 1st and ends on the following May 1st; and this seems to be the policy and intent of the State as expressed in its legislation on this subject.

There is no question that the Legislature had the power to lay an additional occupational tax or license fee to take effect during an existing tax year; and, if by apt and unequivocal language this intention had been